Junior Agriculture Loans
The Montana Junior Agriculture Loan Program was developed to assist and encourage members of agricultural youth organizations in financing agricultural projects. Projects can involve crop and livestock production, custom farming, marketing and distribution, processing, and other financially feasible activities. Loans are made from the assets of the Agricultural Finance Program. Program support and technical assistance are provided by the Montana State University Extension Service, Montana agricultural educators, and private financial institutions.
By providing financial encouragement to young men and women to establish and expand agricultural projects, the program aims to:
- Foster the interest of young people in agriculture, thereby preserving Montana's agricultural future;
- Provide financial experience and training through personal involvement;
- Build experience and equity in agriculture to provide a foundation for future vocations; and
- Provide support to Montana agriculture education and Extension Service youth programs.
Eligibility
Active members of FFA, 4-H and other recognized agricultural youth organizations are eligible for this program. The Montana Department of Agriculture may also make direct loans to youths unable to participate as members of such organizations. Parents or guardians must be willing to cooperate with prospective borrowers and have ample facilities available to provide for the project. Applicants should be between the ages of nine and 21, Montana residents, and citizens of the United States.
Loan Amounts & Terms
The amount of a loan depends on the project, but cannot exceed $3,500 for applicants ages 9-11, or $8,500 for applicants ages 12-21. Applicants may refinance loans, providing they still qualify and do not exceed the $8,500 maximum. More than one family member may qualify for individual loans. Individuals may borrow up to 90% of the total first year cost of a project. Loan repayments periods can be one to five years, depending on the project. Payments are usually made annually. Additional terms, as well as information about the Local Loan Committee, are detailed below under the Loan Terms & Application tab, or download the Montana Junior Agriculture Loan Program Loan Terms & Application (.pdf format).
Loan Terms & Application
Download the Montana Junior Agriculture Loan Program Loan Terms & Application (.pdf format).
Loan Amounts & Terms
The amount of any loan depends on the project, but cannot exceed $3,500 for applicants ages 9-11 and $8,500 for applicants ages 12-21. Applicants may refinance loans, providing they still qualify and do not exceed the $8,500 maximum. More than one family member may qualify for individual loans up to $8,500 each. Individuals may borrow up to 90 percent of the total first year cost of the project. Loan repayment periods can be one to five years, depending on the project. Payments are usually made annually.
Applications
Application forms are available from the department, agricultural education instructors, and county extension agents, or can be downloaded here. Applications must be approved by the local loan committee, with final approval determined by the Montana Department of Agriculture Loan Committee. A written summary of past experience or education relating to the proposed project must accompany the application. A map showing directions to the applicant's farm or ranch is also required with the application.
Local Loan Committee
In each community where prospective borrowers are applying for a Junior Agriculture Loan, there must be a loan committee composed of any three of the following: agricultural education instructors, county extension agents, home demonstration agents, 4-H leaders, or other individuals involved in agricultural production and Montana youth organizations. These other individuals could include representatives from FmHA, Farm Credit Services, or other commercial banks located in the applicant's community.
The purpose of the committee is to review the loan eligibility of applicants, examine cash flow projections, and provide recommendations concerning the loan request. One of the committee members acts as the Project Supervisor for the duration of the loan. Project Supervisors are encouraged to actively participate in loan projects through periodic home visits, technical assistance, and support of the requirements of the local committee and the Department of Agriculture.
Additional Requirements
Upon approval of a Junior Agriculture Loan application, borrowers must agree to the following terms and requirements:
- Applicants must follow the recommendations of the loan committee to the best of their ability.
- Borrowers will identify livestock by brand or other approved identification. All cattle projects must have a registered brand (registered to the applicant through the Montana Department of Livestock.)
- Applicants will cooperate fully with project supervisors using the best management and record-keeping practices.
- Applicants must allow the project supervisor and representatives of the Montana Department of Agriculture to inspect and observe the project at any reasonable time.
- Loans will be secured by liens on all livestock, commodities, or other assets involved in the project.
- When any secured property is sold, the check must be made payable to both the borrower and the Montana Department of Agriculture. In the event that all secured property is sold during the loan term, the balance owed to the Montana Department of Agriculture shall become immediately due and payable in full.
- Secured property is to be kept on premises owned and/or occupied by the applicant as identified in the loan application and loan agreement. All livestock must be confined behind adequate fences at all times. Permission must be received from the Montana Department of Agriculture before any secured property is moved to another county or state.
- The loan funds will be advanced to the applicant by check.
- Applicants will request a local lending institution officer to assist with loan closing procedures.
- A supervised bank account may be established between the borrower and the project supervisor (acting for the Department of Agriculture) for disbursement of funds and deposit of income or proceeds from the project.
- At the time of their annual payment, applicants will be required to include a written summary of their project.
- Applicants and parents or guardians will sign all required forms in a manner as approved by the Montana Department of Agriculture.
Junior Agriculture Loan Forms & Files
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